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Do Safety Nets Promote Technology Adoption? Panel data evidence from rural Ethiopia

  • Alem, Yonas

    ()

    (School of Business, Economics and Law)

  • Broussard, Nzinga H.

    ()

    (The Ohio State University)

We use panel data from rural Ethiopia to investigate if participation in a safety net program enhances fertilizer adoption. Using a difference-in-difference estimator and inverse propensity score weighting we find that participation in Ethiopia’s food-for-work program increased fertilizer adoption. Results also indicate that the likelihood of adopting and the intensity of fertilizer usage increased with livestock holdings for food-for-work-participant households providing some evidence that the intervention helped asset-rich farm households more than asset-poor households. We find no significant effects of free distribution on fertilizer adoption or intensification. Our results are consistent with the hypothesis that safety nets can be viewed as mechanisms that allow households to take on more risk to pursue higher profits. The paper highlights important policy implications related to the inter-related dynamics of safety nets and extension services that aim at promoting productivity enhancing modern agricultural technologies.

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File URL: http://hdl.handle.net/2077/32449
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Paper provided by University of Gothenburg, Department of Economics in its series Working Papers in Economics with number 556.

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Length: 23 pages
Date of creation: 28 Feb 2013
Date of revision:
Handle: RePEc:hhs:gunwpe:0556
Contact details of provider: Postal: Department of Economics, School of Business, Economics and Law, University of Gothenburg, Box 640, SE 405 30 GÖTEBORG, Sweden
Phone: 031-773 10 00
Web page: http://www.handels.gu.se/econ/

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  1. Stein Holden & Bekele Shiferaw & John Pender, 2001. "Market Imperfections and Land Productivity in the Ethiopian Highlands," Journal of Agricultural Economics, Wiley Blackwell, vol. 52(3), pages 53-70.
  2. Dercon, Stefan & Christiaensen, Luc, 2007. "Consumption risk, technology adoption, and poverty traps : evidence from Ethiopia," Policy Research Working Paper Series 4257, The World Bank.
  3. Broussard, Nzinga H & Dercon, Stefan & Somanathan, Rohini, 2012. "Aid and Agency in Africa: Explaining Food Disbursements Across Ethiopian Households, 1994-2004," CEPR Discussion Papers 8861, C.E.P.R. Discussion Papers.
  4. Gine, Xavier & Townsend, Robert & Vickery, James, 2007. "Patternsof rainfall insurance participation in rural India," Policy Research Working Paper Series 4408, The World Bank.
  5. Stefan Dercon & Pramila Krishnan, 2003. "Food aid and informal insurance," CSAE Working Paper Series 2003-01, Centre for the Study of African Economies, University of Oxford.
  6. Andersson, Camilla & Mekonnen, Alemu & Stage, Jesper, 2009. "Impacts of the Productive Safety Net Program in Ethiopia on Livestock and Tree Holdings of Rural Households," Discussion Papers dp-09-05-efd, Resources For the Future.
  7. Yonas Alem & Mintewab Bezabih & Menale Kassie & Precious Zikhali, 2010. "Does fertilizer use respond to rainfall variability? Panel data evidence from Ethiopia," Agricultural Economics, International Association of Agricultural Economists, vol. 41(2), pages 165-175, 03.
  8. Matias Busso & Patrick Kline, 2008. "Do Local Economic Development Programs Work? Evidence from the Federal Empowerment Zone Program," Cowles Foundation Discussion Papers 1639, Cowles Foundation for Research in Economics, Yale University.
  9. Clay, Daniel C. & Molla, Daniel & Habtewold, Debebe, 1999. "Food aid targeting in Ethiopia: A study of who needs it and who gets it," Food Policy, Elsevier, vol. 24(4), pages 391-409, August.
  10. Gilligan, Daniel O. & Hoddinott, John, 2006. "Is there persistence in the impact of emergency food aid? Evidence on consumption, food security, and assets in rural Ethiopia," FCND discussion papers 209, International Food Policy Research Institute (IFPRI).
  11. Gine, Xavier & Yang, Dean, 2007. "Insurance, credit, and technology adoption : field experimental evidence from Malawi," Policy Research Working Paper Series 4425, The World Bank.
  12. Marianne P. Bitler & Jonah B. Gelbach & Hilary W. Hoynes, 2003. "What Mean Impacts Miss: Distributional Effects of Welfare Reform Experiments," Working Papers 109, RAND Corporation Publications Department.
  13. Little, Peter D., 2008. "Food Aid Dependency in Northeastern Ethiopia: Myth or Reality?," World Development, Elsevier, vol. 36(5), pages 860-874, May.
  14. Feder, Gershon & Just, Richard E & Zilberman, David, 1985. "Adoption of Agricultural Innovations in Developing Countries: A Survey," Economic Development and Cultural Change, University of Chicago Press, vol. 33(2), pages 255-98, January.
  15. Jayne, Thomas S. & Strauss, John & Yamano, Takashi & Molla, Daniel, 2000. "Targeting Of Food Aid in Rural Ethiopia: Chronic Need or Inertia?," Food Security International Development Papers 54048, Michigan State University, Department of Agricultural, Food, and Resource Economics.
  16. Gilligan, Daniel O. & Hoddinott, John, 2007. "AJAE Appendix: Is There Persistence in the Impact of Emergency Food Aid? Evidence on Consumption, Food Security and Assets in Rural Ethiopia," American Journal of Agricultural Economics Appendices, Agricultural and Applied Economics Association, vol. 89(2), May.
  17. John Pender & Berhanu Gebremedhin, 2008. "Determinants of Agricultural and Land Management Practices and Impacts on Crop Production and Household Income in the Highlands of Tigray, Ethiopia," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 17(3), pages 395-450, June.
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